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The 442nd Forum on Research Work

19 October 2022

Global Energy Supply and Demand Outlookby 2050

Shigeru SUEHIRO
Econometric and Statistical Analysis GroupThe Energy Data and Modelling Center
The Institute of Energy Economics, Japan

What is IEEJ Outlook 2023?
 Quantify the global energy supply and demand structure
up to 2050
 Forecast-based outlook using econometric models andother tools

Energy consumption composition (2050)

The forecast type is a method of looking ahead to the future with various assumptions,starting from the present. On the other hand, the backcast type is a method of thinking
about how to take measures from the present, setting goals for the future.

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 Conduct scenario analyses of technological and policy
developments and trends
Reference Scenario
A scenario in which the prevailing changes will continue
against the backdrop of current energy and environmental
policies
Advanced Technologies Scenario
A scenario in which energy and environmental technologies
are introduced to the maximum extent possible to ensure astable supply of energy and strengthen measures against
climate change
A part of last year’s “Circular Carbon Economy/4Rs Scenario” is reflected.
- Hydrogen-fired power generation, hydrogen direct combustion, hydrogen reduction
ironmaking, fuel cell vehicles, and synthetic fuel and synthetic methane
technologies are assumed.
- Supply limited to blue hydrogen or green hydrogen.

* Includes the steel blast furnace sector2Increase in energy demand centring on India and ASEAN
Primary energy demand outlook

Changes in primary energy demand (2020-2050)

 (Reference) Primary energy demand will continue to grow, increasing 1.3-fold in 2050.

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 (Advanced Technologies) After peaking in the early 2030s, it will gradually decrease. Emerging Market andDeveloping Economies remain largely unchanged after the 2030s.
 In both scenarios, demand growth is centred on India and ASEAN. China, which has been driving demand
growth, will also peak by 2030 in the Reference Scenario.
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Significant progress will be made in energy efficiency and low-carbon
power generation (Advanced Technologies Scenario)

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Final energy consumption outlook

Electricity generated outlook

 (Reference) Final consumption increases 1.2-fold. More than 40% of the increase will come fromtransportation, and more than 60% from electricity.
 (Advanced Technologies) Energy savings of 23% relative to the Reference Scenario. The electrification ofconsumption is increasing. The share of electricity will rise to 39% (from 20% in 2020).
 Electricity demand will increase significantly in both scenarios. In the Reference Scenario, fossil fuel-fired aswell as renewables will meet the increased demand. In the Advanced Technologies Scenario, the share ofrenewables will rise to 60%. The zero-emission power source, including thermal with CCS, exceeds 80%.
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Dependence on fossil fuels continues

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Primary energy demand outlook

Natural gas and LNG demand outlook

 (Reference) Oil will continue to increase slightly, natural gas will increase 1.5 times, and coal will decline
after peaking around 2030. Demand for natural gas, mainly for power generation, grows, while LNG
demand doubles. Asian demand, in particular, will be the driving force.
 (Advanced Technologies) Oil and coal will decline in the 2020s, while natural gas will be the only fossil fuelto grow more than it is today. LNG demand remains around 400 million tonnes. Nuclear and renewables will
each double, but the share of non-fossil fuels as of 2050 is around 40%. However, about 20% of fossil fuels
are decarbonised (by CCS).
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Emerging Market and Developing Economies key to achieving carbon
neutrality

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Energy-related CO2 emissions outlook

CO2 emissions outlook by region

 Energy-related CO2 emissions under the Reference Scenario continue to increase. On the other hand, underthe Advanced Technologies Scenario, it will peak in the first half of the 2020s and decrease to 17 GtCO2 by2050. It would be a path slightly above the APS*, which incorporates countries’ carbon neutral declarations.
 In both the Advanced Technologies Scenario and the APS*, overall non-OECD emissions are only about 4050% lower. Reducing emissions in developing countries is key to achieving global carbon neutrality. It will
also be necessary to keep an eye on whether developed countries can follow through on the declaration.
*APS: Announced Pledges Scenario, estimates when countries’ stated policy goals are realised. Includes industrial processes. IEA “World Energy Outlook 2022”(October 2022).

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Conclusion
 Energy demand in China, which has been until recently driving global demand growth, will
peak and decline by around 2030. Instead, India and ASEAN will be the focus of increased
demand.
 Electricity demand will increase significantly in both the status quo world (ReferenceScenario) and the decarbonising world (Advanced Technologies Scenario). Stable power
supply and security will become more important in the future.
 Dependence on fossil fuels will continue. Fossil fuels accounts for 80% in 2050 under theReference Scenario and 60% in the Advanced Technologies Scenario (about 20% of which
is decarbonised). Stable supply of fossil fuels remains a key issue.

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 Even the Advanced Technologies Scenario is far from achieving global carbon neutrality in
2050. In particular, further promotion of energy conservation and decarbonisation indeveloping countries will be key to the progress of global decarbonisation.

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Contact : report@tky.ieej.or.jp